This story is part of Billboardthe third annual package highlighting the trends defining the independent music industry.
Despite around 60,000 songs uploaded to Spotify every day, unsigned and independent artists recently found themselves with more options than ever before to fund their careers – and use that cash flow to stand out in a crowded space.
In this rapidly changing landscape, companies like Indify, beatBread and Cash App’s Cash App Studios have materialized, offering funding and advances to independent artists without asking for intellectual property in return. Unlike a label service provider or distributor, these companies do not provide a team of dedicated professionals dedicated to your project; instead, their monetary investments are left indefinite, so what you do with your funding is (mostly) up to you.
“We believe that bundling services with funding can create friction,” says Peter Sinclair, co-founder and CEO of beatBread. “If artists can separate these conversations, they’re often better served. “
The most active of the three funders, Indify, compares itself to an angel investment platform. “Indify is really committed to choosing investors who can provide mentorship or artist development in addition to capital for early artist careers,” says co-founder / CEO Shav Garg. With investors such as Reddit founder Alexis Ohanian, among others, every freelance artist who works with the company will have Indify game matchmaker for the act. “The right partner, the right time and the right amount of capital [are] crucial.”
In an ideal scenario, the investments will be clawed back (and then some), with the investors earning a percentage of the artist’s streaming royalties. While not all independent artists are eligible for funding, the startup is using data-driven insights to find artists who are growing organically, but could use an additional monetary push.
So far, according to Connor Lawrence, co-founder and chief marketing officer of Indify, the “majority of transactions are profitable.” Each deal varies, but Indify has a few requirements: the artists retain ownership of the masters, investors cannot earn more than 50% of the artist’s streaming profits after recovery, and the artist must retain creative control.
This last point is essential for beatBread, an advanced funding option only for unsigned talent. “We want you to have the freedom to choose your own team,” says Sinclair. A more open platform than Indify, beatBread is generally willing to fund artists with over 10,000 monthly listeners on Spotify, and artists design their own deals based on parameters such as duration, capital required, and share. catalog and / or future streaming release royalties. . Then the proposed deal – which can range from $ 1,000 to $ 1 million – is reviewed by the beatBread team and verified. Sinclair said. But in their experience, most artists focus on paying collaborator fees, creating music videos, and funding digital marketing campaigns.
Cash App, the popular finance app, is a rarity in this space: with its new Cash App Studios initiative, the company is giving monetary gifts to music, fashion and entertainment artists without asking for anything in return. According to Victoria Monét, a freelance artist and composer of Ariana Grande, receiving funding from the company has been the “most non-invasive, creative and caring partner I have ever worked with.” Unlike other startups, Cash App Studios has the advantage of giving away free money as a goodwill – and good public relations – to musicians.
And while these companies see themselves as a viable new option for freelance artists, the ultimate goal is for DIY artists to make their own choices when the time is right. “We don’t see ourselves as a replacement for labels,” says Matthew Tilley, artist and industry relations manager for beatBread. “We’re just giving them options. “